The Evening Standard has reported a £17m loss after Covid-19 more than halved its revenues between April and September last year.
Accounts for Evgeny Lebedev’s Evening Standard Ltd, filed with Companies House this week, show the London newspaper’s annual turnover for the year to 27 September 2020 was down 31% year-on-year to £44.1m.
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The Standard said revenues in the second half of the financial year, from April to September, were at just 40% of their prior-year level as lockdown hit its ad-based commuter-focused model.
Advertising sales represent more than 90% of its turnover, which suffered as readers stayed at home rather than commuted to work and many businesses were forced to close and events forced to cancel last spring.
The Standard reduced its print distribution from 800,000 copies a day to roughly 500,000, delivering about half of that to homes to maintain reach and visibility among Londoners. The ES Magazine temporarily stopped production.
It made a pre-tax loss of £17m in 2019/20, 26% worse than its £13.6m loss in 2018/19.
Events revenue was down £10% to £1.2m. The newspaper has run the Evening Standard Theatre Awards since 1955 and the Evening Standard Business Awards since 2016 but neither event took place in 2020 (although the theatre awards were within the 2019/20 financial year).
The Standard made use of the Government’s job retention scheme, claiming £1.2m to furlough staff.
It later spent £4.3m restructuring the now digital-first business “to create a sustainable cost base and ensure the future viability of the business”. Redundancies saw the Standard’s average monthly number of employees go down from 378 in 2019 to 320.
In total 115 jobs were made redundant, of which 69 were editorial – equal to 40% of the newsroom - but many came in October after the 2019/20 financial year.
Chief executive Charles Yardley said in the accounts: “The company has recently completed a significant restructuring as a result of difficult market conditions.
“However, the changes reflect the evolution of the company’s business priorities which are being led by the changing behaviours and demands of our readers and customers.
“Our focus is on building a digital and mobile platforms, alongside the printed paper, whilst also developing a live events business and introducing new digital led products and initiatives.
“There will also be continued focus on improving the company’s financial performance, cost control and development of new business across the business.”
The company is now expecting to grow its digital revenues by more than 20% year-on-year, which it said was mainly driven by the success of its creative sell.
Revenues across its creative revenue lines are forecast to grow by more than 70% year-on-year, helped by the launch of new products and partnerships with key clients like TikTok and Huawei.
Flagship branded content offering Brand Posts allows clients to pay to publish content directly on the Standard’s website while Brands Sponsored uses the Standard’s in-house team for more traditional commercial content and Brand Stories offers “a visual content solution modelled on an Instagram-style social story experience” through partners Newsroom AI.
Since October, the start of this financial year, the Evening Standard online has recorded more than 60m global unique visitors each quarter, with growth each period. Its dwell time in the first half of the year was up 13% year-on-year.
An Evening Standard spokesperson said: “Despite a very strong start, 2019/2020 was challenging due to the Covid-19 pandemic and resulting lockdown, which impacted not just the Evening Standard, but the sector as a whole.
“However, the exceptional circumstances presented us with the opportunity to accelerate the diversification of our offering and move to a digital-first strategy focused on delivering quality insights and products to our readers and brand partners.
“We are proud that despite the challenging market conditions, we continued to print throughout all lockdowns, swiftly pivoting to a home distribution model.
“Our digital transformation and expanded editorial offering is already showing positive results leading to new and rapidly growing revenue streams.
“As we emerge from the pandemic, the Evening Standard will continue to play a vital role at the heart of London, as we embrace our culture of heritage and innovation and adapt to changing audience and partner demands.”
Lebedev also owns The Independent, whose 2020 results showed Covid-19 did not stop it achieving a fourth year in profit since going digital-only.